Determinants of Indigenous Labour Supply Following a Period of Strong Economic Growth

Abstract

This paper provides evidence on changes in the labour force status of Indigenous and other Australians since the mid-1990s, a period of strong macroeconomic growth. The paper expands the standard definitions of labour supply to consider marginally attached workers—people who want to work but who are not currently looking for work. The results suggest that a period of strong demand for labour and improvements in Indigenous education levels are important factors in the strong increases in Indigenous employment rates. However, future progress in increasing Indigenous employment and narrowing the employment gap is likely to require that labour supply issues that discourage people from looking for work—including labour market discrimination and the ongoing high level of Indigenous interaction with the criminal justice system—are addressed.